Thursday, April 30, 2015
So you're the new CEO of your own company. You're living the dream! You've thought through the pros and cons of being a CEO and you've got your first round of venture capital funding.
This means you also have a board to manage, which can be a minefield for you. So how to navigate the minefield? To begin, you must create a well-organized board meeting. Use my Top 10 tips to run a board meeting as a starting point but once you have the logistics down, it's all about your behavior and leadership in the room.
One of the most common mistakes I see with new CEOs is thinking they need the board's approval. You don't. Your job is to figure out the strategy, what to do and to make good decisions so that your company grows. A board's job is to support and advise you. Sometimes board members get confused about this and they will believe that they are there to make decisions; however, beyond hiring a new CEO or deciding whether to put more money in, they don't have that power. If you take their advice and it's wrong, they'll still fire you, so the decisions, ultimately, lie with you.
The board needs you because you are the leader, the one who hired your team, the one who holds the strategy and the one with the customer relationships, so replacing you is a major risk for the company (not to mention a major time sink for the board members). The board will judge you on the quality of your decisions, whether or not you follow their advice. If the board loses confidence in you then they will replace you, but up until that moment you are in the driver's seat and they are there to help you. This is not permission to be arrogant or disrespectful, but understanding this dynamic will help you be a better, more confident CEO. What you need most of all is to gather all of the input and perspective you can from your board, but not decisions.
Here are some questions to ask yourself to ensure your behavior in your board meeting maximizes the result:
1. Are you unconsciously seeking your board's approval? For example, what do you say when an investor tells you to do something that you believe is wrong? If you are seeking their approval, you will probably validate the idea "that's a great idea," but if you are seeking input, then you'll acknowledge the idea instead by a comment such as "thank you for your input, let me think about it." Develop a stable of respectful responses that tell your board that you heard them, it's good input, but you'll still need to decide.
2. If you are female--is your behavior serious enough? If you giggle, fidget, run your hand through your hair or exhibit any of the "girlish" characteristics, you will be judged and taken less seriously. Unfair, but true. So learn to sit still, don't fidget, lean forward, take notes (but in a considered way), lower your voice and dress carefully. Imagine how a strong male CEO whom you respect would sit in the meeting- are you conveying the same level of gravitas?
3. Where do you sit? Don't sit at the front of the room, eagerly presenting all the slides to your teachers. Sit in the middle, or at the head of the table, and host your staff as they present their materials. Sit yourself between the power players, not in service to them.
4. What is your communication between meetings? Again, you are running the company and while some level of update is appropriate between meetings, a running commentary is not. Think about what impression you want to create. The more you communicate the details, the more you invite your board to weigh in with their opinions. Be thoughtful about what, and when, you communicate. You want to be thorough, but that is why there is a board packet. Assume your board members can read.
5. Have you properly prepped your team? It's worth having a prep meeting with your team to talk through the agenda and what you want to get out of the meeting. Manage their presentations to be crisp and brief (three slides is a good rule of thumb). Use their time wisely and excuse them before the long debates begin, because they have real work to do.
Your board is there to help you. They are not your friends or your teachers. They are investors and representatives of the shareholders who only want you to maximize their return. Up until the time that your company is profitable and/or public, you need their support. Always keep in mind, you are running the company, not the board. It's worth remembering that in 99 percent of the cases, the board needs you to lead the company more than you need them. If that is not the case for you, then you may be in the wrong job.
Respectfully remember that up until the minute they fire you, your board needs you more than you need them. Remind yourself of this and you will keep your head in the right place during board meetings.